Quality Management Cost, Measurement

Quality management cost is always a good investment for the organization. It helps in producing better product at lower cost, which helps you to compete in this competitive environment. Appraisal costs are associated with quality inspection and testing activities to sort out good products from the bad prevention costs are the costs of quality management programmed for example design reviews, failure analysis, quality functions use matrix and quality training prevention costs are typically very low. When quality management is introduced one would expect prevention costs to increase and failure costs and assessment costs to go down.

Quality measurement should start with a system for documenting non conformances. Every time an item fails a test, a purchased item to rejected or sent for rework, a statistically controlled process (SQP) exceeds its limits, and a product is returned from the customer non conformance must be documented. A computerized data base should be used to enter and store this information because the volume of data is too huge for a manual system to be effective. Organization can also have an ERP (Enterprise Resource Planning) system.

The information should be recorded in a way that gives easy reports to analyze the problem and take preventive action. The idea is not to produce loads of paper but to collect data that can be analyzed to provide direction to the quality improvement program. A computer program or software is necessary because one needs to be able to sort failure costs into categories, for example by product type, supplier or type of error. There are many off the shelf network database software that can be used to calculate or analyze. The information should be displayed using graphs, presentations, charts which show trends, bar charts and pie charts that indicate rankings.

I hope in this article you have read some information about quality management cost and its measurement.

Read information on the Quality Improvement of Products and Services to improve customer satisfaction. Also read Benefits of ERP and Definition of ERP – Enterprise Resource Planning system.

Failure of Six Sigma Benchmarking efforts – Why?

Six Sigma Benchmarking efforts are systematic and structured, concentrating on superior performance at the end of the project. The success of each benchmarking efforts is dependent on the participation of all the team members, black belt and champion involved. The involvement and the commitment of senior management are necessary and it plays a vital role for six sigma efforts.

Internal process of the project understanding is very necessary for the six sigma team. Six sigma efforts will definitely fail if Six Sigma team does not understand the internal processes or management does not support them on regular basis. Team should focus on area of concern.

Due to following reasons six sigma benchmarking efforts fails in many companies:

Lack of understanding: Lack of understanding of internal processes, vision, mission and goal of the organization is the key factor for Six Sigma benchmarking failures. Management must align the activities with the mission statement of the organization otherwise all efforts will be wasted.

Other factors are: fail to understand the needs and wants of the customer; the out comes of the processes and the performance of the complete process.

Lack of sponsorship: The acceptance of the six sigma benchmarking project and its objectives potential costs by management is very important otherwise any improvements made may prove useless. Team leaders may not accept the improvements for lack of understanding of internal processes.

Unfamiliar Teams: Members of the team should be familiar to the process or the area under consideration otherwise they will not be able to understand the details of the process and its relevance to the success of the project. The members of the six sigma team should be people who have vast experience in the working of the process.

Too Much Work: If team decides to cover broader area, it will be unmanageable to carry out all the projects systematically and timely to its logical solution. Team should prepare simple flowcharts, logical approach to six sigma efforts to complete the six sigma project successfully.

Lack of Commitment: If managers underestimate the efforts in terms of times and cost without knowing the pros and cons of the project, it will fail. Lack of commitment of top management six sigma efforts means sure failure of the project.

If management is involved in six sigma process and take special attention then this process will definitely give positive results, better ROI (return of investment) to the organization.

Read information on the Process of Six Sigma benchmarking efforts. Also Know ERP Features and Functions – Enterprise Resource Planning system.